Obeids used inside info to buy farms: ICAC

An ICAC inquiry heard ex-Labor MP Eddie Obeid had early access to mining data for the Bylong Valley.Source: AAP

THE Obeid family used "inside information" that coal mining would start in NSW's Bylong Valley to snap up farms sitting on lucrative coal deposits, a corruption inquiry has heard.

The Independent Commission Against Corruption (ICAC) is investigating former Labor minister Ian Macdonald's decision in 2008 to open the Bylong Valley to coal mining and how it benefited another ex-minister, Eddie Obeid.

Mr Macdonald is accused of doing the bidding of Obeid family members, who allegedly hid their involvement through complex trust and company structures.

Confidential documents made by Anthony Rumore, a lawyer for the Obeid family, were shown to the inquiry on Wednesday, revealing the Obeids knew about a government expressions of interest (EOI) process to open up coal mining in the Bylong Valley months before the EOI was issued.

One of the documents shown to the inquiry referred to a meeting between Mr Rumore and Paul and Gerard Obeid, two sons of Eddie Obeid, on June 23, 2008.

The government EOI was issued on September 9, 2008.

"The Obeids were telling you that an EOI would issue ... and they knew that it would relate to obviously coal," counsel assisting the inquiry Geoffrey Watson put to Mr Rumore.

"Yes," Mr Rumore replied.

The inquiry has previously heard only high-level officials inside the department of primary industries or the minister's office should have had access to the "inside information".

The inquiry was told that in 2008 the Obeid family acquired two properties in the coal-rich Bylong Valley located close to another property, Cherrydale Park, that Eddie Obeid had acquired in September 2007.

Mr Rumore said the Obeids stood to gain financially from the purchases after the EOI was issued and mining leases were granted over the land.

"I was always told that the Obeids expected that when the mining lease was granted that their property would increase three to four times its current value as a rural property," Mr Rumore said.

Mr Rumore said at the time he did not consider the EOI information was secret because it was openly discussed by the Obeids.

Earlier, John Cherry, a former accountant and farmer who sold Cherrydale Park to the Obeids, said Eddie Obeid wanted to change name details on ownership documents involved in the acquisition to hide his involvement.

Mr Cherry said Mr Obeid wanted to make the changes to create the appearance that "he was against coal mining in the Bylong Valley".

Before he even listed the property for sale he got a call from a station agent who told him Mr Obeid was interested in buying the farm, Mr Cherry said.

He said even though the farm was "plush pasture" for top-of-the-line cattle farming, Mr Obeid told him he wanted to run goats, cattle, have a milking cow and do "all sorts of strange things" on the land.

Mr Cherry said that after selling the farm he received a report that Mr Obeid only ran 150 "old breeding cows" on the property.

"Putting that number of old cows on the property, that was just treating them as mowers," Mr Watson suggested.

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